Study on relationship between co-operatives and privately owned businesses in uMgungundlovu

Thursday, April 28, 2016

A UKZN researcher recently presented his work investigating the networking activities or the lack of them between co-operatives and privately owned businesses in the uMgungundlovu District Municipality in KwaZulu-Natal.

Dr Andrew Okem.

A UKZN researcher recently presented his work investigating the networking activities or the lack of them between co-operatives and privately owned businesses in the uMgungundlovu District Municipality in KwaZulu-Natal.

Okem’s study found that most participant co-operatives operated in rural, underdeveloped locations and were hindered by several challenges including lack of finance, access to inputs, land, transport, market, income, knowledge, and skills. Of the 26 co-operatives interviewed, only three reported networking with private business.

‘Access to market and inputs were the two benefits that accrued to co-operatives from networks with privately owned businesses,’ said Okem. ‘Those interviewed identified a number of barriers to networking with private businesses including lack of benefits for co-operatives, lack of interests in networking with co-operatives, lack of experience on the part of co-operatives and a general absence of trust between co-operatives and private businesses.’

According to Okem, the identified challenges, coupled with the absence of networks with private business, have precluded these cooperatives from producing positive outcomes for members in light of existing government institutional support to cooperatives in South Africa.

‘Such support should be geared towards capacitating cooperatives to engaging in productive networking activities with privately owned businesses. However, the support should enhance rather than undermine the independence of cooperatives,’ concluded Okem.